ASMedia forcasts weak fourth quarter

By Lisa Wang / Staff reporter

Thu, Nov 15, 2012 - Page 13

ASMedia Technology Inc (祥碩科技), which designs data storage controller chips, yesterday said it expected business to weaken this quarter on seasonal factors, despite a good outlook for next year on growing adoption of its high-speed data storage.

Demand “does not look as healthy as we imagined,” ASMedia president Lin Che-wei (林哲偉) told reporters on the sideline of an investors’ conference ahead of the company’s initial public offering (IPO) scheduled for next month.

“Tablets and smartphones continue to be the bestsellers,” Lin said.

Storage chips used in PCs and PC motherboards accounted for more than 76 percent of ASMedia’s revenue of NT$1.31 billion in the first three quarters of the year.

FOURTH QUARTER

“The fourth quarter will be a slower [period] than the third quarter,” Lin said.

“Last year, we also experienced a similar seasonal pattern,” he said.

ASMedia was founded by Asustek Computer Inc (華碩電腦) president Jerry Shen (沈振來) eight years ago and now is a 49 percent owned subsidiary of Asustek.

About 30 percent of ASMedia revenue comes from Asustek orders.

The company has hired Yuanta Polaris Securities Co (元大寶來證券) to help underwrite 4.99 million shares on the nation’s main stock market.

Gross margin is expected to grow to 40 percent this year, Lin said. Last year, gross margin plunged to 38.8 percent from 44.8 percent in 2010.

ASMedia posted NT$207 million (US$7.11 million), or NT$4.03 per share, in net profits in the first three quarters of this year.

Last year, net profits surged 3.5-fold to NT$216.89 million, or NT$5.08 a share, from NT$46.89 million, or NT$1.17 a share, in 2010.

Lin was optimistic about the company’s operations next year, saying: “We hope next year will be a growing year.”

GROWTH DRIVERS

The uptake of advanced USB3.0 and Intel Corp’s thunderbolt technologies will drive ASMedia’s growth in the second half of next year, helped by the sale of Ultrabooks and PCs running Microsoft’s new Windows 8 operating system, Lin said.

New clients and new chips would also be growth drivers, he said.

ASMedia counts the world’s major PC brands and the world’s top three hard-drive makers, including Toshiba Corp, as its clients.

Lin also said an intellectual property infringement lawsuit filed by Taiwanese chip designer VIA Technology Inc (威盛) had not affected the company’s business or future projects, because ASMedia had fully communicated about the situation with it clients.